Trapattoni said: "It is a huge honour and privilege to represent the Irish team and we look forward to continuing.

"Marco and I believe very strongly in the work that we are doing to grow and develop the Irish team."

Media playback is not supported on this device

FAI chief executive John Delaney on Trapattoni's contract extension

Trapattoni's deal will again be part-funded by businessman Denis O'Brien, who played a significant part in the Football Association of Ireland's original acquisition of the former European Cup winner.

O'Brien will fund half of Trapattoni's annual salary which is believed to be in the region of £1.25m.

In his first two years, Trapattoni earned approximately £1.45m per year.

FAI chief executive John Delaney said: "On behalf of the FAI board of management, we are very happy to agree a contract extension with Giovanni and his team.

"They have done fantastic work bringing us to a major tournament for the first time in 10 years.

"Giovanni's experience, professionalism and achievement in qualifying for Euro 2012 has impressed everyone including the players and the FAI board.

Trapattoni's record as Republic of Ireland manager

Played: 42

Won: 19

Drew: 15

Lost: 8

"The FAI board of management are particularly grateful to Denis O'Brien for his continuing contribution which gives the Irish team and supporters the benefit of Giovanni's services into the next World Cup campaign."

Delaney refused to reveal Trapattoni's salary but said that the Republic manager had agreed to take "a significant" pay cut.

Trapattoni, who has taken the side to 21st in the world rankings, will now travel to Kiev for Friday's Euro 2012 draw ahead of the tournament in Ukraine and Poland.

For the latest updates and reaction to this story, read Sportsday Live. Have your say on Twitter via the hashtag #bbcsportsday.